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“Deficit spending.”

Consequences of Deficits

1. During the Great Recession, the U.S. government increased spending in an attempt to buoy the economy. Since, at the time, economic growth was stagnant—and even declining in some quarters—there was not enough government revenue generated to keep pace with spending. Consequently, the government engaged in “deficit spending.” What are fiscal deficits? What are the consequences of deficits?

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